Tesla Motors Inc (NASDAQ:TSLA)‘s investments are yet to pay off but that does not mean the stock cannot soar by ten times to highs of $1900 per share according to a research team at Morgan Stanley (NYSE:MS). Even as the giant electric car marker continues to struggle to ship more cars, a number of investors continue to remain bullish on the stock, notes Fox Business Neil Cavuto.
Profitable Trading senior analyst, Jared Levy argues that in a few years’ time nobody will care about the number of cars that Tesla Motors Inc (NASDAQ:TSLA) ships. But essentially the battery business that looks destined to take over the industry by surprise.
“[..] Think about this 71 million cars were sold in 2014. If 5-10 years from now Tesla Motors Inc (NASDAQ:TSLA) can just sell batteries to 6% of that, capturing just $1500 per battery that would equate to $11.4 billion in profits for Tesla. That’s by itself, forgetting the cars, forgetting maintenance, forgetting the infrastructure, forgetting anything else the company does that could equate at a normal multiple of 18,” said Mr. Levy
Tesla Motors Inc (NASDAQ:TSLA) wants to become the world’s biggest producer of lithium ion batteries as the company seeks to become the chief supplier of batteries in the fast growing electric car space. The batteries produced by its Gigafactory could also find their way into the solar industry another pumped-up market.
Tesla Motors Inc (NASDAQ:TSLA)’s battery technology could, on the other hand, be a big impediment to the company hitting big strides with sales according to Villas Capital Management CEO, Johnson Thompson. The technology according to the analyst is not yet there in terms of what consumers want such as being able to drive 400-500 miles without having to worry about the charge. The charging time is another point of concern with many calling for duration of not more than two minutes.
“The charging time, they just can’t get that down. The wiring system and the electrical grid is just not deep enough; you can’t pump enough electricity through the wires,” said Mr. Thompson
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